Re-Designate Clergy Housing Allowance Each Calendar Year
The clergy housing allowance is an important tax exclusion for ministers. The amount is set by way of an official board action prior to the start of each calendar year. (Make a note now to put this on your December agenda!) So why are we mentioning it in May? Well, two reasons.
First of all, ministers preparing to begin new positions this summer are in the process of working with their congregations on their ministerial agreements. While sometimes the agreement may specify the amount of the housing allowance, often the actual dollar figure is determined closer to the start date, after housing is secured and anticipated costs are better known. We don't want this piece of the process to fall through the cracks, especially since the designation must be made
in advance of expenses incurred in order for the tax exclusion to apply.
The second reason for this reminder is that we're hearing from ministers who have recently realized that a designation was never made for 2017 (or that it was set too low). It's not too late to designate or re-designate. Just keep in mind that any new or adjusted amount only operates prospectively, i.e., it can only be applied to expenses incurred
after the date of the designation.
Housing Allowance Resources: